How to Get a Wholesale Auto License

by Larry Parr

Getting a wholesale auto license varies slightly from state to state, but the steps listed in this article are valid in most places and will only require slight modifications in others. Keep in mind that most states have two classes of auto-selling licenses: wholesale and retail. A wholesale license only allows for the purchase of vehicles from dealer auctions or directly from licensed dealers nationwide (no buying from the street). A wholesale license only allows for the selling of vehicles to dealers; a wholesale license does not allow for the sale of any vehicle to any member of the general public. A retail license provides all of the advantages of a wholesale license but also allows for the purchase and sale of vehicles to the public as well.

Contact your local Department of Motor Vehicles (DMV) or Department of Transportation (DOT) office and obtain a wholesale license application from the Dealer Licensing Unit.

Fill out the form and return it with the required fee. Include the names and addresses of all people who will be involved in your wholesale auto business.

Pay the fee for a background check. A criminal background check is run on you and all other people listed on your application. In most states any fraud conviction within the past 10 years or any felony conviction within the past 5 years will be grounds for a denial of your wholesale auto license.

Take the state test to become a wholesale dealer. Most people take a pre-test prior to taking the actual test in order to familiarize themselves with the types of questions they will be asked on the licensing test. There is a fee for this test, which varies from state to state.

Purchase a bond. Anyone with a wholesale auto license must be bonded in every state. The size of the bond varies greatly from state to sate.

Tip

  • check Once you have your wholesale auto license you can attend dealer auctions in any state, but you may only sell to car dealers in your own state. Many wholesale auto licenses only allow the wholesaler to purchase four vehicles at a time, but this restriction varies by state.

Warning

  • close A wholesale auto license does not allow you to sell any vehicles to a member of the general public.

About the Author

Larry Parr has been a full-time professional freelance writer for more than 30 years. For 25 years he wrote cartoons for television, everything from "Smurfs" to "Spider-Man." Today Parr train dogs and write articles on a variety of topics for websites worldwide.